The key in any equation is the data that's being crunched. In this case, this is the key point:
"Since teams rarely go for it on fourth down -- last year, the league's 31 teams went for it a collective 468 times, an average of less than once per game -- Romer decided it was not a representative sample. He elected instead to use third-down statistics in assessing probability. In addition, he used only first-quarter statistics because, generally speaking, score and time left did not influence decisions that early in a game."
Therefore it's much more complicated than the equation would indicate. The first major fallacy is using 3rd down statistics, but emotion/momentum have a ton of influence on any game. Not converting on 3rd down has a much different emotional response compared to not converting on 4th down. The next fallacy is only using data from the 1st quarter, which gives absolutely no direction on what to do for the remaining 3 quarters.
I agree that there wasn't enough 4th down data in his initial analysis to create any meaning determinations. But rather than simply using 3rd down and 1st quarter data instead I believe was wrong. Instead if he really wanted to produce a meaningful study, increase the number of years of data and then break the analysis down by quarter. Then use the rating of the team's defense versus the opponents offense as well as the score difference as factors in the equation.
I would agree with the general premise that teams tend to be too conservative when it comes to 4th down, but as Walsh indicated, it's much more complicated than the little equation indicates. I think MM has done a good job with his decisions on whether or not to go for it. One major thing helping him in those decisions is the fact that our defense is pretty good and can generally hold the opponent to a FG or less if we don't convert.
IMHO, look at the game situation, your teams strengths/weaknesses versus the opponents, location on the field -- ultimately the reward versuses the consequence. I say that if you can live with the consequence of not converting, then go for it! It's a huge reward if you make it!